Rare earth elements
Updated
Summary
Rare earth elements are a group of 17 metals: scandium, yttrium and the 15 lanthanides. Their largest global use is in permanent magnets, mostly made from neodymium-praseodymium (NdPr). Mining is less concentrated than processing. USGS estimates world output at 390,000 t of rare-earth oxide in 2025, with China producing 270,000 t. The IEA puts China at about 60% of mined magnet rare earths, 91% of refined output and 94% of sintered magnet output in 2024. China has also licensed exports of seven medium and heavy rare earths since 2025-04-04.
Key numbers
World rare-earth mine production, all rare earths in REO terms (USGS estimate): 390,000 t REO (China 270,000 t) (as of 2025-12-31). Source: pubs.usgs.gov
China share of mined magnet rare earths (not all REE) / refined output / sintered magnet output (IEA): ~60% / 91% / 94% (as of 2024-12-31). Source: iea.org
World reserves (USGS); China share of listed reserves: >85 million t REO; China 44 million t (as of 2025-12-31). Source: pubs.usgs.gov
US net import reliance, compounds and metals (USGS): 67% (China 71% of 2021-24 imports) (as of 2025-12-31). Source: pubs.usgs.gov
US mine production and value (USGS): 51,000 t REO; $240 million (as of 2025-12-31). Source: pubs.usgs.gov
NdPr oxide price, 99% min (USGS 2025 estimate): $69/kg (as of 2025-12-31). Source: pubs.usgs.gov
MP Materials NdPr price floor (DoD, 10 years): $110/kg (as of 2025-07-10). Source: sec.gov
MP Materials NdPr oxide production, Q2 2026: 840 t (+41% y/y) (as of 2026-06-30). Source: sec.gov
Lynas NdPr production / average selling price, June quarter 2026: 1,857 t / A$98.2/kg (record) (as of 2026-06-30). Source: announcements.asx.com.au
MOFCOM No. 61 value-share threshold for foreign-made items (suspended to 2026-11-10): 0.1% Chinese-origin rare-earth content (as of 2025-10-09). Source: mofcom.gov.cn
IEA projection (April 2026 vintage): existing + announced outside-China capacity vs needs in 2035: ~1/4 of refining needs; <1/5 of magnet demand (projection, not observed output) (as of 2026-04-08). Source: iea.org
IEA conditional scenario (April 2026): activity outside China exposed if 2025 controls were fully implemented: up to $6.5 trillion per year (exposure estimate; not losses, not an unconditional forecast) (as of 2026-04-08). Source: iea.org
Timeline
2026-10-15 — MOFCOM offers continued rare-earth licence facilitation for Europe and asks for EU reciprocity on dual-use cases. (Source: mofcom.gov.cn)
2026-10-09 — The Commission selects 46 new Strategic Projects, four on rare earths for the permanent-magnet value chain. (Source: luxembourg.representation.ec.europa.eu)
2026-09-25 — White House says China will keep working on US rare-earth shortage concerns. (Source: whitehouse.gov)
2026-08-07 — Department of War commits $150 million to rare-earth-free magnets (Niron). (Source: whitehouse.gov)
2026-08-06 — MP Materials reports Q2 2026 NdPr output of 840 t and $17.6 million of price-protection income. (Source: sec.gov)
2026-07-30 — DPA determination covers recoverable materials, including rare-earth magnets. (Source: whitehouse.gov)
2026-07-22 — Lynas reports June-quarter NdPr output of 1,857 t and a record A$98.2/kg average price. (Source: announcements.asx.com.au)
2026-05-17 — White House says China will address US rare-earth shortage and equipment concerns. (Source: whitehouse.gov)
2026-04-08 — IEA rare-earth report: China holds over 90% of refining and almost 95% of magnet output. (Source: iea.org)
2026-01-14 — Section 232 proclamation on processed critical minerals orders 180 days of negotiations, no tariff; later US action UNKNOWN. (Source: whitehouse.gov)
2025-12-18 — MOFCOM says some rare-earth general licences have been approved. (Source: english.mofcom.gov.cn)
2025-12-03 — Commission adopts RESourceEU, including planned permanent-magnet scrap export restrictions (implementation status UNKNOWN). (Source: ec.europa.eu)
2025-11-07 — MOFCOM/GACC Announcement No. 70 suspends Nos. 55-58, 61 and 62 until 2026-11-10. (Source: mofcom.gov.cn)
2025-11-01 — US-China arrangement: China to suspend October 2025 rare-earth controls and issue general licences. (Source: whitehouse.gov)
2025-10-09 — MOFCOM Announcement No. 61 extends licensing to foreign-made items with 0.1%+ Chinese rare-earth content. (Source: mofcom.gov.cn)
2025-10-09 — MOFCOM Announcement No. 62 controls exports of rare-earth processing and magnet-making technology. (Source: mofcom.gov.cn)
2025-07-10 — MP Materials-DoD deal: $400 million equity, $110/kg NdPr floor, 10X offtake (plant commissioning targeted for 2028). (Source: sec.gov)
2025-04-04 — MOFCOM/GACC Announcement No. 18 puts seven medium and heavy rare earths under export licensing. (Source: mofcom.gov.cn)
Key actors and links
China (country:china): Mines ~69% of world output (270,000 of 390,000 t REO, all rare earths, USGS; AA arithmetic) and over 90% of refining (IEA); its licensing sets supply access.
United States (country:united-states): 67% import reliant for compounds and metals (USGS); responds with price floors, Section 232 talks (post-180-day status UNKNOWN) and the DPA.
Pentagon (actor:pentagon): MP Materials shareholder and NdPr floor guarantor; backs offtake for the planned 10X magnet plant (commissioning targeted for 2028).
European Union (actor:european-union): Pursues CRMA 2030 benchmarks (targets) and RESourceEU (scrap limits planned; implementation UNKNOWN); MOFCOM asks it for dual-use reciprocity.
Neodymium (commodity:neodymium): With praseodymium forms NdPr, the magnet input covered by the $110/kg US floor.
Praseodymium (commodity:praseodymium): Part of NdPr oxide, which MP Materials and Lynas produce outside China.
Dysprosium (commodity:dysprosium): Licensed by China since April 2025; Lynas made 19 t Dy/Tb in the June quarter.
Terbium (commodity:terbium): Licensed by China since April 2025; target of MP's heavy separation loan.
Australia (country:australia): Hosts Lynas's Kalgoorlie operations (its other site is Kuantan, Malaysia); 6.3 million t of reserves.
Trade fragmentation / tariffs (theme:trade-fragmentation): Licensing and bilateral arrangements are rare earths' main trade-policy channel.
Industrial policy (theme:industrial-policy): US equity stakes, price floors and EU Strategic Projects respond to concentration.
Defense Industrial Base (concept:defense-industrial-base): The DoD-MP deal and DPA determination treat magnets as defence inputs.
European defense spending (theme:european-defense-spending): Defence magnet demand depends on supply the EU is diversifying.
Why it matters now
Since 2025, rare earths have been a trade-policy instrument. Beyond its April 2025 licensing of seven elements, on 2025-10-09 China issued Announcement No. 61, which reaches foreign-made goods with 0.1% or more Chinese rare-earth content by value, and No. 62, which controls processing and magnet technology. After the US-China arrangement of 2025-11-01, MOFCOM suspended both until 2026-11-10 and began approving general licences; the April regime stays in force. The IEA says the 2025 controls caused significant short-term disruptions outside China.
Importers answered with industrial policy. The US Defense Department took a $400 million stake in MP Materials, set a $110/kg NdPr floor and backed offtake for a magnet plant MP expects to begin commissioning in 2028 (a company target); Washington also opened Section 232 talks and invoked the Defense Production Act for recoverable magnets. The EU added RESourceEU and four rare-earth Strategic Projects. In its April 2026 projection the IEA expects existing and announced capacity outside China to cover only about a quarter of refining needs and under a fifth of magnet demand by 2035 (a projection, not observed output); its conditional scenario puts up to $6.5 trillion a year of activity outside China at risk if the 2025 controls were fully implemented (an exposure estimate, not losses). On 2026-10-15 MOFCOM offered Europe continued licence facilitation and asked for reciprocity on dual-use cases, less than four weeks before the suspension ends.
Two policy statuses are UNKNOWN: whether the US took any action after the Section 232 180-day negotiating window (which ended about 2026-07-13, AA arithmetic from 2026-01-14), and whether the EU's magnet-scrap export restrictions, planned for early 2026, have been implemented. Both should be read as plans, not verified current measures.
Risks and open questions
Bull case: For supply security outside China: MOFCOM suspended its broadest measures, approved general licences and says compliant civilian applications are promptly approved. Non-Chinese output is rising: MP's NdPr production rose 41% year on year and MP has made magnets since December 2025. A contracted $110/kg floor, 100% offtake for the planned 10X plant (commissioning targeted for 2028) and EU Strategic Projects give new capacity revenue certainty.
Bear case: Concentration remains extreme: China mines about 69% of world rare-earth output in REO terms (AA arithmetic from USGS all-REE 2025 estimates; the IEA's ~60% covers magnet rare earths only, a different universe) and holds 91% of refining and 94% of magnets (IEA). The April 2025 controls stay in force and the October 2025 measures are only suspended until 2026-11-10. Most Western offsets (10X commissioning targeted for 2028, Apple shipments expected in 2027, EU scrap rules and stockpiling) are company targets or announced plans, not operating; the implementation of EU scrap restrictions and any US action after the Section 232 180-day window are UNKNOWN. The IEA's April 2026 projection has outside-China capacity meeting only about a quarter of 2035 refining needs, and its conditional scenario puts up to $6.5 trillion a year of activity at risk under full implementation of the 2025 controls (exposure, not losses). White House fact sheets in May and September 2026 still cite US shortage concerns.
Falsifiers: - Bear case weakens if MOFCOM extends or ends the No. 70 suspension, or repeals Nos. 61/62, before 2026-11-10. - Bear case weakens if MP's 10X plant begins commissioning on its 2028 target and non-Chinese magnet output is reported at scale. - Bull case weakens if Nos. 61/62 take effect after 2026-11-10, or MOFCOM ties specific approvals to EU or US licensing decisions. - Bull case weakens if USGS or IEA data show China's refining or magnet share rising, or White House reports of shortages persist into 2027.
What to watch
No. 70 suspension of Announcements 61/62 ends: extension, amendment or lapse. (2026-11-10); Source: mofcom.gov.cn
One-year US suspension of the BIS affiliates rule ends. (around 2026-11-10); Source: whitehouse.gov
US action after the Section 232 180-day negotiating window (ended about 2026-07-13, AA arithmetic); status UNKNOWN, not a verified current measure. (no scheduled date; status UNKNOWN); Source: whitehouse.gov
Commerce rules under the DPA magnet determination. (no scheduled date); Source: whitehouse.gov
EU magnet-scrap export limits and CRM Centre, planned for early 2026; implementation status UNKNOWN. (no scheduled date; status UNKNOWN); Source: ec.europa.eu
MP Materials-Apple recycled magnet shipments (company expectation). (2027); Source: sec.gov
MP Materials 10X magnet facility begins commissioning (company target). (2028); Source: sec.gov
Next MP and Lynas quarterly NdPr and magnet figures. (no scheduled date); speculative, no scheduled source
Any MOFCOM data on EU-bound licence counts or times. (no scheduled date); speculative, no scheduled source
AA inference
Inference (AA): The leverage sits in separation and magnet-making, not mining. China's licensing, not ore scarcity, sets how fast supply reaches US and EU industrial and defence users, so the 2026-11-10 expiry of the No. 70 suspension is the node's main near-term switch. Western offsets (MP's price floor and 10X plant, Lynas, EU Strategic Projects) are real but announced or early-stage. Edges from this node to industrial policy and trade fragmentation should therefore be read as licensing-driven, and price or delivery effects should be asserted only when a primary source shows them.
Sources
USGS defines the rare earths as a group of 17 elements: scandium, yttrium and the 15 lanthanides. (Source: usgs.gov, accessed 2026-10-16)
USGS estimates world rare-earth mine production at 390,000 t of rare-earth oxide (REO) in 2025 (380,000 t in 2024), of which China produced 270,000 t in both years; Burma produced an estimated 22,000 t in 2025 and Australia 29,000 t. (Source: pubs.usgs.gov, accessed 2026-10-16)
USGS estimates US mine production at 51,000 t REO in mineral concentrates in 2025, valued at $240 million; the leading global end use of rare earths is magnets. (Source: pubs.usgs.gov, accessed 2026-10-16)
USGS puts US net import reliance for rare-earth compounds and metals at 67% of apparent consumption in 2025; 2021-24 import sources were China 71%, Malaysia 13%, Japan 5%, Estonia 5%. (Source: pubs.usgs.gov, accessed 2026-10-16)
USGS lists an estimated 2025 NdPr oxide (99% minimum) price of $69/kg and neodymium oxide at $73/kg. (Source: pubs.usgs.gov, accessed 2026-10-16)
USGS lists rare-earth reserves of 44 million t REO in China, 21 million t in Brazil, 6.3 million t in Australia and 1.9 million t in the United States, with a world total above 85 million t. (Source: pubs.usgs.gov, accessed 2026-10-16)
USGS reports that China expanded its rare-earth export controls in October 2025 to europium, holmium, erbium, thulium and ytterbium, suspended those October controls for one year in November, kept the April 2025 controls in effect, and began issuing general export licences to selected exporters. (Source: pubs.usgs.gov, accessed 2026-10-16)
On 2026-04-08 the IEA said China accounts for around 60% of mined production of magnet rare earths, over 90% of refining and almost 95% of permanent magnet production. (Source: iea.org, accessed 2026-10-16)
The IEA projected (2026-04-08) that by 2035 existing and announced capacity outside China would cover only about a quarter of refining needs and less than a fifth of magnet demand, and estimated, as a conditional scenario, that full implementation of China's 2025 export controls could put up to $6.5 trillion of economic activity outside China at risk each year (an exposure estimate, not a measure of losses). (Source: iea.org, accessed 2026-10-16)
The IEA said China's 2025 export controls led to significant short-term disruptions, with some manufacturers outside China struggling to obtain key inputs. (Source: iea.org, accessed 2026-10-16)
The IEA's Rare Earth Elements report puts China at 91% of global refined output and 94% of sintered permanent magnet output in 2024, and projects magnet rare earth demand outside China to rise by 50% by 2035. (Source: iea.org, accessed 2026-10-16)
MOFCOM/GACC Announcement 2025 No. 18, dated 2025-04-04 and effective that day, put samarium, gadolinium, terbium, dysprosium, lutetium, scandium and yttrium items under export control. (Source: mofcom.gov.cn, accessed 2026-10-16)
MOFCOM Announcement 2025 No. 61 (2025-10-09) requires a licence for foreign-made listed items containing Chinese-origin rare-earth items at 0.1% or more of value, and for items made abroad with Chinese rare-earth mining, separation, smelting, magnet-making or recycling technology; those provisions were to apply from 2025-12-01. (Source: mofcom.gov.cn, accessed 2026-10-16)
MOFCOM Announcement 2025 No. 62 (2025-10-09) put rare-earth mining, separation, smelting, magnet-manufacturing and recycling technologies under export control, effective on publication. (Source: mofcom.gov.cn, accessed 2026-10-16)
MOFCOM/GACC Announcement 2025 No. 70 (2025-11-07) suspended Announcements 55-58, 61 and 62 from that day until 2026-11-10. (Source: mofcom.gov.cn, accessed 2026-10-16)
At MOFCOM's 2026-10-15 press conference, spokesperson He Yadong said China is willing to keep facilitating approval of rare-earth export licences for Europe and hopes the EU will reciprocally facilitate key dual-use licence cases concerning China. (Source: mofcom.gov.cn, accessed 2026-10-16)
On 2025-12-18 MOFCOM said a number of general licence applications from Chinese rare-earth exporters had been received and approved. (Source: english.mofcom.gov.cn, accessed 2026-10-16)
On 2025-12-04 MOFCOM said all compliant export applications for civilian purposes had been promptly approved. (Source: english.mofcom.gov.cn, accessed 2026-10-16)
The White House said on 2025-11-01 that China would suspend the export controls on rare earths announced on 2025-10-09 and issue general licences for rare earths, gallium, germanium, antimony and graphite for US end users, while the US would suspend its affiliates rule for one year from 2025-11-10. (Source: whitehouse.gov, accessed 2026-10-16)
A 2026-05-17 White House fact sheet said China would address US concerns about rare-earth shortages, including yttrium, scandium and neodymium, and about restrictions on rare-earth processing equipment and technology. (Source: whitehouse.gov, accessed 2026-10-16)
A 2026-09-25 White House fact sheet said China would continue to work on US concerns about rare-earth supply shortages, aiming for shipment levels to return to appropriate levels. (Source: whitehouse.gov, accessed 2026-10-16)
On 2026-01-14 the President, after a Commerce Section 232 finding that processed critical mineral imports threaten national security, directed negotiations with trading partners, allowing other action if agreements are not reached within 180 days, and said the US would promote price floors with allies; no tariff was announced. (Source: whitehouse.gov, accessed 2026-10-16)
A 2026-07-30 presidential determination under Section 101 of the Defense Production Act covers recoverable critical minerals and materials, explicitly including rare-earth permanent magnets, and directs Commerce to act. (Source: whitehouse.gov, accessed 2026-10-16)
On 2026-08-07 the White House announced a $150 million Department of War investment in Niron Magnetics for rare-earth-free permanent magnets and a DFC-matched $4.8 million investment in a Madagascar rare-earth mine. (Source: whitehouse.gov, accessed 2026-10-16)
MP Materials' July 2025 DoD partnership includes a $400 million DoD preferred-stock purchase, a 10-year $110/kg NdPr price floor, a $150 million DoD loan for heavy rare-earth separation, and DoD-backed offtake of 100% of magnets from a 10X facility expected to begin commissioning in 2028, lifting US magnet capacity to about 10,000 t. (Source: sec.gov, accessed 2026-10-16)
On 2025-07-15 MP Materials announced a partnership with Apple for recycled rare-earth magnets, with a recycling line at Mountain Pass and magnet shipments expected to begin in 2027. (Source: sec.gov, accessed 2026-10-16)
MP Materials reported Q2 2026 NdPr oxide production of 840 t (up 41% year on year), $17.6 million of price-protection-agreement income, and NdFeB magnet manufacturing at its Independence facility since December 2025. (Source: sec.gov, accessed 2026-10-16)
Lynas reported June-quarter 2026 NdPr production of 1,857 t, 19 t of dysprosium and terbium, and a record average selling price of A$98.2/kg, with Kalgoorlie (Australia) and Kuantan (Malaysia) operations, and cited customers seeking supply chains outside China due to geopolitics and export restrictions. (Source: announcements.asx.com.au, accessed 2026-10-16)
The Commission's RESourceEU plan (2025-12-03) would mobilise up to EUR 3 billion over 12 months, restrict exports of permanent-magnet scrap from early 2026, set up a European Critical Raw Materials Centre and pilot joint stockpiling. (Source: ec.europa.eu, accessed 2026-10-16)
The Critical Raw Materials Act sets 2030 benchmarks of at least 10% extraction, 40% processing and 25% recycling of EU consumption of strategic raw materials and no more than 65% from a single third country; the Commission expects EU rare-earth metal demand to rise six-fold by 2030. (Source: single-market-economy.ec.europa.eu, accessed 2026-10-16)
The Critical Raw Materials Act is Regulation (EU) 2024/1252, adopted on 2024-04-11. (Source: eur-lex.europa.eu, accessed 2026-10-16)
On 2026-10-09 the Commission selected 46 new Strategic Projects in 16 member states, four of them on rare earths supporting the permanent-magnet value chain. (Source: luxembourg.representation.ec.europa.eu, accessed 2026-10-16)
The second EU-China Trade and Investment Consultations were held in Beijing on 2026-10-08 and 2026-10-09. (Source: ec.europa.eu, accessed 2026-10-16)